ALBAWABA – Increasing support for Ukraine is the “single best” way to aid the global economy, United States (US) Treasury Secretary Janet Yellen said Sunday.
Additionally, Yellen noted that it is vital to boost emerging economies and tackle debt distress, according to Agence France-Presse (AFP).
Speaking on the sidelines of a G20 finance ministers summit in India, she said a "key priority" was "to redouble our support for Ukraine" in its defence against Russia.
She has seen first-hand "the massive difference" that foreign assistance was making in Ukraine, both to civilians and the Ukrainian military, Yellen said, after having visited the war-stricken country in February.
"Ending this war is first and foremost a moral imperative," Yellen told reporters in Gandhinagar. "But it's also the single best thing we can do for the global economy."
Both Russia and Ukraine are global breadbaskets, exporting almost a quarter of the world's wheat supply. The war has disrupted supply chains and sent food prices through the roof, as well as fuel.
Russia previously agreed to a deal that allowed Ukrainian grain exports to pass through the Black Sea to the rest of the world. But the deal expires on Monday, and the Russians have insinuated they may not be interested in renewing it.
Last Wednesday, leaders of the Group of Seven (G7) promised to support Ukraine for as long as it takes to defeat Russia's invasion.
"Budgetary support is critical to Ukraine's resistance," Yellen said.
"By helping keep the economy and the government running, we are giving Ukraine the support it needs so it can fight for freedom and its sovereignty."
She added that one of Washington's "core goals" was to "combat Russia's efforts to evade our sanctions".
Yellen on Ukraine support and debt distress
There is no trade-off between supporting Ukraine and support for the Global South, according to Yellen. Who said she would “push back on the idea”.
Work is underway to tack debt distress and reforms in multilateral development banks, including the World Bank, to unlock $200 billion within 10 years, she confirmed.
"Over the past few years, we have seen debt vulnerabilities mount for many countries as a result of the pandemic and Russia's illegal war against Ukraine," Yellen said.
More than half of all low-income countries are near or are in debt distress, "double the share of countries that were in this situation in 2015", she said.
Examples on underway efforts is debt restricting in Zambia, and the soon to be finalized processing of Ghana and Sri Lanka debts, the secretary underscored.
She also spoke about efforts to strike a global tax deal.
Yellen said work was focused on creating a system in a world of online and global business that was "fairer and fit for purpose", and to "end the race to the bottom on corporate tax rates".
Multinationals, especially tech firms, are currently able to shift profits easily to countries with low tax rates even though they carry out only a small part of their activities there.
